Utrecht University (UU) in the Netherlands thought it had nothing to be ashamed of when it accepted a €360,000 research grant from Philip Morris International (PMI) last September. The tobacco giant had agreed to fund a study on cigarette smuggling that had obvious public health importance, and the lead researcher, law professor John Vervaele, would enjoy complete academic freedom. Sure, there had been a "thorough debate" about the grant, Vervaele said in a press release, "but the tobacco industry is not illegal. The illicit tobacco trade is."

But the announcement sparked a firestorm of criticism from outside groups, including associations of pulmonologists and oncologists and the Dutch Cancer Society. A university should not take money from an industry whose products kill an estimated 7 million people annually, they argued. And on 17 January, UU made a U-turn, announcing that it would sever ties with PMI and pay for the study itself. By then, the topic had become so controversial that Vervaele was no longer allowed to speak to the press.

PMI, the maker of Marlboro and other tobacco brands, says it supports the foundation because the company wants to end the production and use of combustible cigarettes and help smokers switch to less dangerous alternatives, which PMI is heavily investing in. But many scientists and public health experts say the new foundation is, well, a smokescreen, set up to protect PMI's interests. In a 25 January statement, the deans of 17 schools of public health in the United States and Canada said they would not collaborate with the foundation; an official at the World Health Organization (WHO) in Geneva, Switzerland, has called the foundation a "deeply alarming development."

To the consternation of many public health researchers, the foundation is headed by a former top WHO official, Derek Yach, who was instrumental in developing the Framework Convention on Tobacco Control, a global pact aimed at curbing smoking. Yach left WHO in 2007 to work for PepsiCo; with his new job, his "journey to the Dark Side is now complete," Stanton Glantz, director of the Center for Tobacco Control Research and Education at the University of California, San Francisco, recently wrote. But an editorial in The Lancet called Yach a "respected public health leader" and said a complete boycott of the foundation would be a "mistake."

Accepting tobacco money for research was widely seen as acceptable until the 1990s. But revelations about the way the industry hid data on the risks of smoking from the public and used science to sow confusion and doubt made such funding increasingly taboo for academics. Many universities now shun direct industry funding, and some journals no longer publish tobacco-funded research. Major funders such as the Wellcome Trust and Bloomberg Philanthropies bar their grant recipients from also accepting tobacco money.

But Yach says industry and scientists should work together on "harm reduction" strategies for reducing tobacco's health risks. Harm reduction advocates see promise in e-cigarettes, most of which vaporize nicotine and reduce the inhalation of other toxic compounds. Some have also promoted "heat-not-burn" cigarettes and snus, a powdered tobacco sold in Sweden that is usually placed under the upper lip. The products are meant to complement antitobacco strategies such as taxes, advertising bans, and plain packaging, which have been shown to prevent young people from lighting up but do less to help current smokers quit.

But public funding to help settle those questions is in short supply, says Brad Rodu, a harm reduction advocate at the University of Louisville in Kentucky who for years has relied on tobacco money. The new foundation will help fill that void, says Yach, especially in developing countries. "Our focus is clear, and we're unashamed of it," he says: "It's the billion people who smoke." In addition, the foundation plans to assess tobacco companies' actions to promote smoking cessation and to help tobacco farmers find new livelihoods if demand dwindles.

Critics question PMI's declared commitment to harm reduction. The company has fought antitobacco measures in court and is aggressively marketing cigarettes to young people, says Joanna Cohen of Johns Hopkins University's Bloomberg School of Public Health in Baltimore, Maryland. "If they really wanted a smoke-free world, they would stop doing those things right away." Tobacco control researcher Michael Siegel of Boston University says he's all in favor of harm reduction, but accepting tobacco money makes researchers "pawns" in a public relations strategy. He calls the foundation "a scam."

WHO's Vera Luiza da Costa e Silva, head of the tobacco convention's secretariat, sees another risk: By funding research into nontraditional tobacco products, PMI hopes to influence how those products are regulated in the future, as it has done for cigarettes, she wrote in a statement this past September. The new foundation is "an attempt to breach" the convention, Da Costa e Silva said.

Yach says much of the criticism is based on misconceptions. The foundation's bylaws guarantee complete independence from PMI, he notes. To prevent the foundation from becoming a public relations tool, PMI isn't even allowed to mention its funding in its own publications. Those who say that the industry should simply stop making cigarettes tomorrow "have to understand how their business models work," Yach says. "Companies will continue their current products until they see a tipping point."

The big question is how many researchers will want a share of PMI's $1 billion. "I would be very surprised if reputable researchers applied," says Martin McKee of the London School of Hygiene & Tropical Medicine. But Yach says he's already received 50 to 60 proposals from around the world, including from U.S. medical schools. The foundation will issue a formal call for proposals for centers of excellence after a workshop later this month, and expects to award its first major grants within a few months. Yach isn't expecting the criticism to ease anytime soon, however. "The thing I do worry about is harassment of grantees and staff, the very ad hominem attacks," he says. "That is unacceptable behavior."